Vineyard prices in Burgundy

How much does that vineyard cost? In the video of the day, Alex Gambal, American in Burgundy, discusses vineyard prices in Burgundy and why he and his investors paid $10 million/acre for a sliver of land in Batard-Montrachet.

“It’s a way to preserve capital…You’re buying Treasury bonds today at 2%. What would you rather buy, US treasury bonds or a piece of grand cru in Burgundy where you’re getting 1%–and the dividend is bottles of wine! So it’s not a bad deal!”

I get the scarcity argument but there certainly are carrying costs associated with this type of investment. And weather may wreak havoc with a vintage as parts of the Cote de Beaune saw so dramatically this year so it’s not without risks. What do you think: is he oversimplifying things? Does it make you cry a little bit on the inside to see Burgundy land discussed as a functional equivalent of Treasury bonds?

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4 Responses to “Vineyard prices in Burgundy”

  1. Yes. Nothing kills the romance like a treasury bond. I suppose there is a case that investments such as this ensure the long term stability of the industry though.

  2. Sounds like one of the most fantastic rationalizations I have heard in a long time. Rather than trying to justify the purchase on an economic and relative value (compared to Tsy bonds) basis, which fails on just about every level, he should have just admitted that he spent $10mm/acre to buy a Burgundy Grand Cru vineyard because he loves wine and it was a lifelong dream. That would at least make some sense. I couldn’t help but notice that, right after he rationalizes the investment by comparing the return to Treasury bonds, he basically admits that Grand Cru Burgundy wines are not worth what they cost to buy…so even he isn’t really buying what he is trying to sell.

  3. I chuckled. Sounds like something if would say to my wife to justify an emotional purchase.

  4. […] to see Burgundy land discussed as a functional equivalent of Treasury bonds?” Tyler Colman comments on fascinating video starring Alex […]


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